Host: Today, we're talking about tech Ecosystems, the new operating model with Kevin Adams. Kevin began his career in investment banking and then pivoted to healthcare technology. He's held roles with Cigna, Accenture, and led the digital transformation effort at Edifex. Kevin has served as the healthcare CTO for UST Global, providing a vision for technology and IT trends, and is the co-founder and CEO of UST HealthProof. Kevin, you have a unique vision for payer operations, and I'd love to hear your thoughts and your journey for how you helped shape the vision of HealthProof.  

Kevin: Sure, Niki. It's a lengthy endeavor. It's been about 25 years now that I've been focused pretty much exclusively on health insurance and have worked at a number of different health plans. I think today that's probably numbering in the 30 or 40 different health plans that I've had the opportunity to either spend a long time employed at, like in Cigna, or in the world of helping those health plans achieve better efficiencies and better ability to process the complex systems and complexity of healthcare in general through their own systems. What I've found is that the complicated nature of that has led to an equally complicated technology footprint that insurance companies have had to adopt. And what's unfortunate about it is that when you have an organization that has, say, 10 to 20 million members, that complexity works for them because they're able to drive small efficiencies out of relatively micro-processes through leveraging different types of technologies. And that approach delivers some efficiency. But when you apply that to health plans that have smaller organizations and smaller can be anything below 3 million members, that multi-vendor model, I like to call it the micro-segmentation, using multi-vendor strategies just simply doesn't work at smaller scales. It adds a ton of additional complexity and an equally soluble amount of cost to the models. And when you're an organization, just take a 200,000-member plan; you've got maybe 10 people in IT. Those ten people can't be managing 20 or 30 different vendors, much less the difficulty of managing the integration and the interdependencies between those vendors. And so our approach at HealthProof has been to completely change and implement a different model.  

Host: Can you give me an overview of how the industry came to adopt the multiple vendor model?  

Kevin: Sure. Historically, health insurance companies started with relatively simple macro processes. And macro processes would be something like a claims process, pricing, adjudication, or print. In the early days, it was predominantly a manual process. So, you had an organization that was made up of groups of individuals, and those individuals found the effectiveness or efficiency that they could achieve within their own group. And there might've been in a health plan, maybe seven or eight groups doing the various different tasks. As technology improved and mainframes were adopted, those activities performed in groups were brought into a mainframe. And over time you developed a single monolithic application that essentially processed health insurance. And that worked well for a while until more complexity came into the health insurance world. That would've been probably roughly in the late eighties or early nineties. Then, really in the probably late nineties, when technology became more pervasive, and these subgroups broke down their individual task, and we can use enrollment as an example, and they'd say, well, we've got a Medicare enrollment, we've got a Medicaid enrollment, we have commercial enrollment, and we don't have one piece of technology that works. So why don't we put in or build a piece of technology that does Medicare enrollment? Then you had the commercial enrollment side saying something pretty much the same. And before you know it, you now have taken your macro process of enrollment and broken it down into three micro processes supported by three different pieces of technology. In those early days, it was still a very large organization that supported a large membership. The effectiveness or the efficiency achieved in each one of those micro processes might amount to a percent or two of additional efficiency, but because you're spreading that percent or two across such a large population, it pays for itself. And in that sense, the health plans started to break down all their macro-processes into these micro-processes to the extent that today you might still have the same five to seven macro processes, but now you've broken it out into 50 or 60 microprocessors each supported with their own technology and not to mention their own people operating on those technologies. And that is okay, that works in a large plan, but again, that level of complexity is not sustainable in the smaller plans that we support.  

Host: So how do plans meet their needs without adopting these best in breed systems resulting in disjointed tech stacks?  

Kevin: I actually, I wouldn't necessarily say that they're not using the best of breed or not able to get the benefits of what these microsegmentations are doing. What we're doing instead is bringing them together as a pre-integrated, pre-configured system so that the health plans don't, especially the regional community health plans, don't have to live with the complexity that comes with the benefit. And when you look at our health plan ecosystem, it really is a best-of-breed model where we, instead of saying we think that a particular product is better or worse than something else, we evaluated it, we looked at it, we used it, and we found whether it really is or isn't. And if it is better, we leverage and implement it within our ecosystem. And by bringing together, it's not 50 or 60, it's certainly a much smaller number, but it's still going to be 15 to 20 different technologies or capabilities in our ecosystem that enables us to run the entire back office of a health plan. And that model has dramatically reduced the cost of implementing these technologies and has, at the same time, increased the capabilities of that platform or that health plan and that allows that health plan to deliver whatever benefits, whatever networks, whatever reimbursements that the market demands in their area.  

Host: So you have an ecosystem, it's composed of all these different aspects of the health plans business, and this just all comes integrated out of the box?

Kevin: Essentially. Yes. You never want to understate the complexity. There are definitely still things that need to be integrated into the health plan as one-offs. As an example, yes, we can do all of the healthcare processing. However, at the same time, you still need to integrate into the GL or the HR system or any other back office, truly back office capabilities within that health insurance company. And that still, though, is maybe one 10th of the complexity of trying to do it as a one-off implementation. And oddly enough, nobody else has tried to build what we've built and therefore we can still help another, I think we're about 25 health plans in, and there's still two 50, there's 250 total, so we've got 225 more to help.  

Host: So earlier, you had mentioned that the larger plans could operate off of this other model with multiple vendors, but smaller plans have different needs. Can you talk a little bit more about that?  

Kevin: I’m not sure I would call it different needs. I think the challenge that they have is just that they're smaller and have to be even more efficient. If you're a large national, you have two massive benefits. The first one is scale and scale. When your per-claim cost is spread across a large membership, your scale allows that higher cost but spread out, which allows it to net out to a fairly low number. The second major benefit that health plans have large health plans have is nationwide networks. And so those nationwide networks drive volume to providers, and that volume thus lowers the price of the claim or gives the health plan more pricing power, which nets out to a lower price. So, those two cost drivers are significant. And why today, 70% of all health insurance is delivered by the top six or seven health plans in the United States, yet healthcare should be a local offering. It should be aware of the community, the citizens, families in those local areas. And by the way, it is always delivered on a local nature today, healthcare, not health insurance. And so the notion here was why can't health insurance be delivered locally also and therefore tailored to meet the needs of the communities that they serve? The challenge is that the cost and complexity of doing that were unsustainable. And what you typically found was that you had, I'd call it, a mid-level manager or mid-level executive from a national plan who wanted to be promoted, wasn't promoted maybe in a national plan but found an opportunity to be an executive in a smaller plan. That individual left the larger plan with a mentality of delivering health insurance the way the larger plans did and tried to do it in his or her local plan and found it to be either very expensive or undoable. In many circumstances, it's that audience or that customer that we were attracted to say, well, you need to think differently and act differently. And the approach that we took with regard to our ecosystem-based approach, as opposed to systems integrator, is what we have brought forward to this market.  

Host: It sounds like member experience is really impacted by this model versus having the member pass through a number of disjointed systems. It sounds like this cohesive ecosystem is really valuable for member experience.  

Kevin: It absolutely is. Even in the large plans, member engagement, member experience is a pretty challenging capability, and it's challenged because of the disjointed nature of the systems that are supporting the experience in our world; we have a single source of all information that is needed for engagement. So if you're a member and you've come into a portal and you're looking for some information, say you're looking for a specialist in your area, and you're looking at the benefits that you have, your accumulators, all that information is in near real-time updated to ensure that you can get the most accurate and timely information as a member that you're looking for. But even better, if let's just say they're looking for a specialist and they don't find what they're looking for, they can click to chat, they could click to talk, or they could, in turn, pick up their phone and call the health plan, and it comes into our member engagement solution call center. The information is exactly the same as what the member would've read or seen on the portal. More importantly, we should consider the nature of how we've connected everything. The call agent, once the member has validated who they are, can see that the member was on the portal looking for information, and our next best actions within our call center app would say, I see you were just on the portal looking for a specialist, and is this the reason you're calling for? And that level of connectivity is only possible because of the tightly integrated solution that we've built.  

Host: So how does a plan that's currently on a legacy system or maybe using a multiple vendor model make the transition to an end-to-end ecosystem with HealthProof? We've discussed the benefits, but are there any challenges a plan might expect to encounter when they make a change like this?  

Kevin: For sure. I mean, this is still open-heart surgery for a health plan to make this type of transition. I am not saying we've made it easy. I've always said we've made it easier, and the resources and the time are made lighter, easier, and faster because of the approach we've taken. Certainly, the health plan has a lot of work to do to help us achieve this transition. And predominantly, you have to think about it from the perspective that the folks helping us make this transition still have their day jobs, right? They're still processing health insurance to benefit their members and providers. And so they're trying to basically, you know the proverbial change the wheel while the car's going down the road at a hundred miles an hour is absolutely true. We certainly have taken a lot of the challenges and the pain out of it. We've made it, I remember in the beginning when, sure, I'll go back to my Cigna days. We spent millions to hundreds of millions of dollars and toiled at it for years on end, trying to achieve a transformation. Quite frankly, a lot of times, we failed, but at HealthProof, we're able to make this type of transition in as short as a six-month period. That's very aggressive, it's not aggressive for us, but it's definitely aggressive for our customers. But the normal nine to 12-month range is a typical transition.  

Host: Can you talk a little bit more about the implement-to-operate structure?  

Kevin: Sure. I think one of the other benefits that, I would say, we lucked into as much as we planned for was this notion of us as the operator of what we implement. And so we use this term a lot, implement-to-operate. I don't think any companies today use the model that we've created, and that model is that we've built a tightly integrated best-in-class technology solution that we implement on an outcome basis. And so this outcome basis, meaning it's fixed price, we do not talk about; we tell exactly how much it will cost and how long it will take. What are the resources needed from the health plan to contribute? based on that, we do this implementation for them, but it's not good enough to just implement. We need to ensure that our outcomes are 100% aligned with that of our health plan customers. And so because we are also helping our health plan customers operate their back office post-implementation, if we're not implementing it to be the maximum amount with the maximum amount of efficiency and effectiveness, accuracy, all those types of things, then we're at a potential risk of not being able to meet our SLAs post-implementation. And so when a customer says, I doubt you can do this, they don't need to worry about it because the reality is if we fail, they have another stick to hit us with afterward with the SLAs that we've agreed to with regards to timely processing or timely payment of claims and all those types of good things. And so for the entirety of this experience, this notion of implement to operate is a very sound and measured approach to ensuring the implementations meet the outcomes that we're looking for in terms of price to pay claims, accuracy of those claims, and timeliness.

Host: Kevin, it's been great having you on the podcast today. The concept of UST HealthProof as a true partner with the health plans, sharing the risk, being in business together, also the outcomes really promise to improve the delivery of healthcare in the United States.  

Kevin: That’s absolutely right, and we're in this to help the health insurance business overall. I think that there's a significant amount of inefficiency, some degree profit taking that occurs in this business. And anytime you have either of those two things, you lose the opportunity for some of those dollars to either go to premium relief, i.e. cheaper health insurance costs, or to paying physicians more for the hard work that they do every day.  

Host: Thanks, Kevin, and thank you to our listeners. If you like this episode, share it with your colleagues on LinkedIn and follow on Apple and Spotify to be the first to know when new episodes drop.